By the Division of Banks


COMMONWEALTH OF MASSACHUSETTS

Suffolk, SS.

COMMISSIONER OF BANKS
MORTGAGE LOAN ORIGINATOR
LICENSING
Docket No. 2013-006

NOTICE OF INTENTION TO
ISSUE AN ORDER OF
PROHIBITION

In the Matter of
MAGNO GABRIEL JIMENEZ

Mortgage Loan Originator License No. MLO829147


This Notice of Intention to Issue an Order of Prohibition, Docket No. 2013-006 (Notice of Order), commences an adjudicative proceeding under the provisions of General Laws, chapter 30A, section 10 and the Standard Adjudicatory Rules of Practice and Procedure, 801 CMR 1.01 and 1.03.

JURISDICTION

  1. Pursuant to General Laws chapter 255F, section 2, the Commissioner has jurisdiction over the licensing and regulation of persons and entities engaged in the business of a mortgage loan originator in Massachusetts.
  2. Pursuant to General Laws chapter 255F, section 11(d), the Commissioner may issue a written notice of intention to prohibit a person from any further actions, in any manner, as a mortgage loan originator or to prohibit the person from being employed by, as an agent of, or operating on behalf of a mortgage loan originator or any other business which requires a license from the Commissioner.
  3. General Laws chapter 255F, section 11(d)(i) states that the Commissioner may issue such Notice of Order when any person has, directly or indirectly, violated any section of General Laws chapter 255F or any rule or regulation promulgated thereunder or any order issued by the Commissioner under General Laws chapter 255F or any written agreement entered between the person and the commissioner.
  4. General Laws chapter 255F, section 11(c) authorizes the Commissioner to impose a civil assessment for violations of chapter 255F which may not exceed $25,000 per violation.
  5. FACTUAL BACKGROUND AND STATEMENT OF ALLEGATIONS

  6. According to the Division’s records and the Nationwide Multi-State Licensing System & Registry (NMLS), Magno Jimenez was issued a Massachusetts mortgage loan originator license on June 26, 2012.
  7. According to the Division’s records and the NMLS, Magno Jimenez did not request renewal of his Massachusetts mortgage loan originator license for calendar year 2013 and his license was terminated as of January 1, 2013.
  8. Pursuant to General Laws chapter 255F, section 7(b) and 209 CMR 41.07(4), a mortgage loan originator license that has expired may be reinstated if a request for reinstatement is submitted through the NMLS no later than the last day of February of the license year, provided that the individual has satisfied the minimum standards for renewal.
  9. The requirements for an individual to obtain a Massachusetts mortgage loan originator license include, but are not limited to, the following:
    1. Achieving a passing score, as so defined, on a qualified written examination developed by the NMLS, which includes both a national and Massachusetts component. An applicant must achieve a passing score on both test components; and
    2. Demonstrating that the individual possesses the character, reputation, integrity, and general fitness such as to command the confidence of the community and to warrant a determination that the individual will engage in the business of a mortgage loan originator in an honest, fair, sound, and efficient manner.
  10. On June 16, 2012, Magno Jimenez took the Massachusetts State Component test required by the Secure and Fair Enforcement of Mortgage Licensing Act (SAFE Act) and General Laws chapter 255F, section 6 at the Prometric Test Center located at 1290 Hancock Street, Anaheim, California 92807. Magno Jimenez obtained a passing score on both the national and Massachusetts test components of the SAFE Act Test completed on that day.
  11. Based, in part, on Magno Jimenez having received a passing score on the Massachusetts test component, the Division of Banks (Division) granted a Massachusetts mortgage loan originator license to Magno Jimenez on June 26, 2012.
  12. The NMLS Rules of Conduct for test takers are displayed electronically on the test candidates’ computer screen as part of the standard automated test process and Magno Jimenez was required to agree to the NMLS Rules of Conduct by selecting the "AGREE" option on the computer screen before proceeding with the test.
  13. Rule No. 3 of the NMLS Rules of Conduct states: "I must not receive or attempt to receive any form of assistance during the test or restroom breaks."
  14. Rule No. 10 of the NMLS Rules of Conduct states: "I must not engage in any conduct that would be contrary to good character or reputation, or engage in any behavior that would cause the public to believe that I would not operate in the mortgage loan business lawfully, honestly or fairly."
  15. The Mortgage Testing and Education Board (MTEB), acting on behalf of the State Regulatory Registry, LLC and the NMLS, is responsible for the oversight of SAFE Act required testing and the administration of the NMLS Rules of Conduct for test takers.
  16. On June 26, 2012, the Manager of Mortgage Test Operations, State Regulatory Registry received a report (the FINRA Report) from the Financial Industry Regulatory Authority (FINRA) alleging that Magno Jimenez accessed written study materials during a three minute unscheduled break taken while taking the Massachusetts State Component of the SAFE Act Test. The FINRA Report incorporated, among other things, an attached incident report filed by the Test Center Administrator of the Prometric Test Center.
  17. On June 28, 2012, the Manager of Mortgage Test Operations, State Regulatory Registry presented the report referenced above to the MTEB for further investigation. The FINRA Report is attached and is incorporated in its entirety by reference. The FINRA Report alleges that Magno Jimenez took a three minute break during the Massachusetts State Component test. The Report alleges that fifteen minutes after Magno Jimenez took his break, the Test Center Administrator discovered a packet of notes behind the toilet seat covers in the men’s restroom. The notes related to Massachusetts mortgage loan originator licensing and compliance.
  18. The FINRA Report further alleges that, after his break, Magno Jimenez reviewed all his answers to the test questions and changed two answers from incorrect to correct. Magno Jimenez was the only test candidate sitting for the Massachusetts State Component test on that day.
  19. A review committee consisting of three members of the MTEB (Review Committee), in accordance with the Administrative Action Procedures which were developed and implemented by the MTEB to govern their investigative process, conducted a full investigation of Magno Jimenez’s alleged violations of the NMLS Rules of Conduct. The MTEB provided Magno Jimenez with notice and an opportunity to respond to the allegations that he accessed test materials during a break taken during his completion of the Massachusetts State Component of the SAFE Act Test.
  20. Magno Jimenez contacted the Review Committee on July 6, 2012 and July 17, 2012 in response to the investigation.
  21. On August 28, 2012, the Review Committee concluded that Magno Jimenez violated the Rules of Conduct Nos. 3 and 10. The Review Committee’s investigation report is attached and is incorporated in its entirety by reference.
  22. By correspondence dated September 24, 2012, Magno Jimenez appealed the Review Committee’s findings.
  23. The Chair of the MTEB appointed a three-person Appeals Committee, which conducted the appeal process and concluded on October 18, 2012 that there were no material errors of fact in the Review Committee’s investigative findings, and affirmed the investigative findings of the Review Committee holding that Magno Jimenez violated the Rules of Conduct Nos. 3 and 10.
  24. MTEB has granted the Division access to the materials gathered relative to the MTEB’s investigation of this matter.
  25. On December 12, 2012, Magno Jimenez updated his NMLS record by disclosing that the investigation regarding his allegedly violating the NMLS Rules of Conduct numbers 3 and 10 had concluded and that he had been found in violation of the Rule of Conduct. He also uploaded a detailed written response to the MTEB’s conclusions.
  26. Based on the above allegations, Magno Jimenez has failed to exhibit the character, reputation, integrity, and general fitness such as to command the confidence of the community that would be required in order to hold a mortgage loan originator license pursuant to Massachusetts General Laws chapter 255F, section 4(a)(iii) and the Division’s regulation 209 CMR 41.04(2)(d).
  27. Based on the Division’s review of the MTEB findings and the documents and materials relied upon by the MTEB, the Division has determined that the Massachusetts mortgage loan originator license was erroneously granted to Magno Jimenez based upon the Division’s belief at the time that Magno Jimenez had obtained a passing score on the Massachusetts State Component of the SAFE Act Test in a manner consistent with his agreement to act in accordance with the NMLS Rules of Conduct for test takers.
  28. NOTICE OF RIGHT TO REQUEST A HEARING

  29. This Notice of Order shall become effective immediately upon service upon Magno Jimenez.
  30. You or your authorized representative are required to file an Answer or otherwise respond, in writing, to the Allegations contained in this Notice of Order within twenty-one (21) days of the effective date of this Notice of Order, pursuant to the Standard Adjudicatory Rules of Practice and Procedure, 801 CMR 1.01 (6)(d).
  31. You have the right to request a hearing on this Notice of Order, as well as the right to be represented by counsel or other authorized representative, to call and examine witnesses, to introduce exhibits, to cross-examine witnesses who testify against you, and to present oral argument.
  32. Any such request for a hearing on this Notice of Order shall be in writing, signed by Magno Jimenez or by his duly authorized representative, and shall be delivered either by hand or certified mail, return receipt request, to the Division of Banks, 1000 Washington Street, 10th Floor, Boston, MA 02118.
  33. Pursuant to the Standard Adjudicatory Rules of Practice and Procedure 801 CMR 1.01(6)(c), the request for a hearing on this Notice of Order shall state clearly and concisely:
    1. why Magno Jimenez should not be prohibited from any further actions, in any manner, as a mortgage loan originator or to prohibit the person from being employed by, as an agent of, or operating on behalf of a mortgage loan originator or any other business which requires a license from the Commissioner;
    2. Why Magno Jimenez should not be prohibited from applying for reinstatement of his Massachusetts mortgage loan originator license;
    3. any other relief that Magno Jimenez seeks relative to this Notice of Order.
  34. A hearing will be scheduled on this matter only upon receipt of a written request for such a hearing from Magno Jimenez within twenty-one (21) days of service of this Notice of Order upon him. If Magno Jimenez fails to request a hearing within this twenty-one (21) day period or fails to appear at a scheduled hearing date, Magno Jimenez shall be deemed to have consented to the issuance of an order of prohibition in accordance with this Notice of Order, pursuant to M.G.L. c. 255F, section 11(d)(ii).
  35. The hearing shall be fixed for a date not more than thirty (30) days after the date of service upon the Commissioner of the request for hearing and will be conducted according to Massachusetts General Laws, chapter 30A, sections 10 and 11, and the Standard Adjudicatory Rules of Practice and Procedure, 801 CMR 1.01 and 1.03.

BY ORDER AND DIRECTION OF THE COMMISSIONER OF BANKS:

Dated at Boston, Massachusetts, this 25th day of January, 2013

By:
Paul A. Gibson
Senior Deputy Commissioner
Commonwealth of Massachusetts

This Notice of Intention to Issue an Order of Prohibition has been vacated pursuant to a Consent Order, effective February 20, 2013.